Vietnam’s economy in slow mode

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The economy of Vietnam expanded at its slowest pace in 13 years in 2012 as bank lending and domestic demand eased, adding pressure on the government to revamp the financial system and attract more foreign investment.

The country’s GDP rose 5.03 per cent this year, the General Statistics Office said in Hanoi on December 24, down from 5.89 per cent in 2011 and the slowest since the 4.77 per cent in 1999.

Furthermore, foreign direct investment pledges fell 14 per cent this year and Vietnam’s credit rating was cut by Moody’s in September as mounting bad debt and weakened state-owned enterprises limited room for policy makers to boost growth. The government has said it may form an asset manager to clean up lenders, and the World Bank and International Monetary Fund (IMF) are preparing their first review of the banking system as a blueprint for the sector.

Vietnam’s economy has been hampered by slower lending as banks grappled with rising bad debt and undercapitalisation. The central bank in December cut benchmark interest rates for a sixth time in 2012, saying the adjustments are to help companies cope with difficulties in production and business.

Banks have reported bad debt to be about 4.5 per cent of outstanding loans, while the central bank’s estimate is about 8.75 per cent, the IMF has said. Credit growth this year was 6.45 percent, the planning ministry said today. That compares with 14 percent last year and 32 percent in 2010, according to the IMF.

The real-estate market is stagnant and shows no sign of recovery, while the number of insolvent businesses continues to rise, the government said on December 10.

Vietnam’s growth this year “is good enough given that we made curbing inflation our top priority for the year,” said Do Thuc, general director of the General Statistics Office.

Vietnam’s growth this year “is good enough given that we made curbing inflation our top priority for the year,” Do Thuc, general director of the General Statistics Office, was quoted as saying by Bloomberg.

Inflation slowed for the first time in four months in December, with consumer prices rising 6.81 per cent from a year earlier after climbing 7.08 percent in November, a report showed.

Vietnam may expand about 5.5 per cent next year, the government said.

 

 

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Reading Time: 2 minutes

The economy of Vietnam expanded at its slowest pace in 13 years in 2012 as bank lending and domestic demand eased, adding pressure on the government to revamp the financial system and attract more foreign investment.

Reading Time: 2 minutes

The economy of Vietnam expanded at its slowest pace in 13 years in 2012 as bank lending and domestic demand eased, adding pressure on the government to revamp the financial system and attract more foreign investment.

The country’s GDP rose 5.03 per cent this year, the General Statistics Office said in Hanoi on December 24, down from 5.89 per cent in 2011 and the slowest since the 4.77 per cent in 1999.

Furthermore, foreign direct investment pledges fell 14 per cent this year and Vietnam’s credit rating was cut by Moody’s in September as mounting bad debt and weakened state-owned enterprises limited room for policy makers to boost growth. The government has said it may form an asset manager to clean up lenders, and the World Bank and International Monetary Fund (IMF) are preparing their first review of the banking system as a blueprint for the sector.

Vietnam’s economy has been hampered by slower lending as banks grappled with rising bad debt and undercapitalisation. The central bank in December cut benchmark interest rates for a sixth time in 2012, saying the adjustments are to help companies cope with difficulties in production and business.

Banks have reported bad debt to be about 4.5 per cent of outstanding loans, while the central bank’s estimate is about 8.75 per cent, the IMF has said. Credit growth this year was 6.45 percent, the planning ministry said today. That compares with 14 percent last year and 32 percent in 2010, according to the IMF.

The real-estate market is stagnant and shows no sign of recovery, while the number of insolvent businesses continues to rise, the government said on December 10.

Vietnam’s growth this year “is good enough given that we made curbing inflation our top priority for the year,” said Do Thuc, general director of the General Statistics Office.

Vietnam’s growth this year “is good enough given that we made curbing inflation our top priority for the year,” Do Thuc, general director of the General Statistics Office, was quoted as saying by Bloomberg.

Inflation slowed for the first time in four months in December, with consumer prices rising 6.81 per cent from a year earlier after climbing 7.08 percent in November, a report showed.

Vietnam may expand about 5.5 per cent next year, the government said.

 

 

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